Smartphones recognised for boosting operator results

Announcing their third quarter results, the CEOs of France Telecom and TeliaSonera made particular reference to their company's financial performance being boosted by the growing usage of smartphones.

France Telecom CEO Stéphane Richard admitted that the revival in the company's fortunes in the third quarter--albeit by revenues inching up by 1.3 per cent--were "in large measure due to the significant recovery of mobile services, spearheaded by smartphones."

The CEO of TeliaSonera, Lars Nyberg, was more forthright on the impact of smartphones. He acknowledged that the uptake of this device category was boosting the company's mobile data revenues, and that seven out of 10 customers in Sweden were buying a smartphone with higher usage and ARPU as a result.

"The new iPhone 4 has been very well received by our customers and we can now see that other smartphone models based on Android and Symbian platforms are also getting a lot of traction," he added.

According to the market research firm Strategy Analytics, the impact of smartphone on operators' performance shouldn't have been a surprise. The firm estimates global smartphone volumes rose a huge 78 per cent annually to 77 million units during Q3 2010, making up 23 per cent of total worldwide handset volumes during the quarter, leaping from 20 per cent from the previous quarter.

Of note, Strategy Analytics pointed towards sales numbers being boosted heavily by Apple's iPhone range, together with the added impact of several major Android players expanding their smartphone ranges, notably Samsung and HTC.

However, this demand for smartphones is now causing strains with the component supplier base, which is likely to cause production problems during Q4 2010 and Q1 2011.

The smartphone industry is still struggling to ramp up the production capacity of key components after major cutbacks during the recession of 2009, while smartphones are now facing extra competition for many of the same components from the emerging tablet segment.

For a review of the top 5 European smartphones please click here. -Paul